Anheuser-Busch partners with UFC's Dana White for a fresh energy drink venture.
In a bid to revive flagging beer sales, Anheuser-Busch is venturing into the energy drink market, partnering with UFC President Dana White to launch Phorm Energy, their latest caffeinated beverage. The non-alcoholic drink, set to hit shelves nationwide on Wednesday, is the first product resulting from a broader partnership between the two parties, aiming to capitalize on the booming $24 billion energy drink category.
Phorm Energy, zero-sugar and artificially-flavored, boasts electrolytes and natural caffeine from green tea extract. It will be available in four flavors—grape, orange, blue, and a blend of blueberry, cherry, and citrus—and will retail for $2.99 per 16-ounce can.
Declining beer sales have prompted Anheuser-Busch to explore new growth avenues. With beer consumption dipping more than 1% in 2024, according to Brewers Association data, Big Beer companies have turned to options such as spirit-based cocktails, non-alcoholic varieties, and even energy drinks, with the latter projected to reach $33 billion over the next five years, according to Mintel research.
Rival Molson Coors has already found success in the energy drink segment, purchasing a majority stake in Zoa, a brand co-founded by actor Dwayne "The Rock" Johnson. Zoa has achieved repeat purchase rates of 50%.
Anheuser-Busch's previous forays into energy drinks, however, have not been as fruitful. The company sold Hiball, an energy seltzer water brand it bought in 2017, to Tilray Brands in 2023. More recently, it held a 40% stake in energy drink Ghost, but lost that investment when Keurig Dr Pepper acquired Ghost in a $1 billion deal last year.
Despite these setbacks, Jenn Litz-Kirk, director of content for Beer Business Daily, sees potential in this latest move by Anheuser-Busch. "The energy segment is hot, and it's a high-margin proposition for both retailers and distributors," she stated. Phorm Energy, she suggests, is an attempt to recreate the success of Ghost—a strategy that could prove pivotal in a rapidly growing market.
The partnership with Dana White further bolsters Anheuser-Busch's position in the energy drink market. The pair joined forces in 2023, when Bud Light became the official sponsor of White's mixed martial arts league following a backlash against a Bud Light-related social media post by transgender influencer Dylan Mulvaney.
White's involvement is seen as a marketing boon. His significant public profile, particularly among sports and fitness enthusiasts, is believed to draw in a younger, health-conscious demographic—a key target for energy drinks. Meanwhile, partners 1st Phorm, while linked to past controversy, have cleared the air, reassuring stakeholders with statements distancing the company from any controversial comments made by co-founder Andy Frisella.
Anheuser-Busch, in an effort to diversify and increase revenue, is delving into the energy drink market, partnering with UFC President Dana White to launch Phorm Energy. This venture is part of a broader strategy to capitalize on the booming $33 billion energy drink industry, as projected by Mintel research, and possibly recreate the success of previous partnerships like the one with Ghost. Leveraging Dana White's significant public profile among sports and fitness enthusiasts could draw in a younger, health-conscious demographic, making Phorm Energy a high-margin proposition for retailers and distributors in the competitive technology-driven business landscape.
